Fiji

Group taxation is not available in Fiji.

Transfer pricing

Transfer pricing provisions state that the tax authority may allocate income and expenses between associates (related entities) to reflect income and expenses on an arm’s-length basis.

The Income Tax (Transfer Pricing) Regulations provide that the Organisation for Economic Co-operation and Development (OECD) Transfer Pricing guidelines may be used in interpreting the provisions of the Regulations in determining income or expenses on an arm’s-length basis.

Thin capitalisation

If a foreign controlled resident company, other than a financial institution, has a debt-to-equity ratio in excess of 2:1 at any time during a tax year, interest expense in relation to that part of the debt that exceeds the ratio is not allowed as a tax deduction unless the company can properly substantiate the arm’s-length nature of the debt.

Effective 1 April 2020, thin capitalisation rules will be suspended for borrowings undertaken from 1 April 2020 up to 31 December 2020 that result in the debt-to-equity ratio exceeding 2:1. Effective from 1 August 2020, the debt-to-equity ratio has been increased to 3:1.

Controlled foreign companies (CFCs)

Fiji does not have specific rules in relation to CFCs.